The Prius Effect

The experts at the Toyota Motor Co. were persistently wrong about the Prius. They seriously underestimated how popular it would be.

When it appeared in Japan in 1997, the world’s first mass-produced gasoline-electric hybrid car was not immediately recognized as a serious automotive challenge to the omnipresence of the internal-combustion engine.

The car was introduced to Japanese drivers in 1997. About 18,000 sold that year. On Earth Day, 2000, Toyota announced that the car was on its way to the United States, and the first American drivers stepped into their new hybrid cars in August.

Throughout the next five years, the only way to get hold of a Prius in the United States was by preordering one from the manufacturer. The waiting time for a new Prius was often more than six months. Its popularity was not based on economic necessity. When the new car first launched in the United States, gas was cheap. At that time, regular gasoline was selling for about $1.30 a gallon and inefficient SUVs were in their heyday. Toyota would debut a website via which car buyers could make a “pioneer purchase” of the Prius. About 6,000 American consumers signed up and got their hands on a Prius that first year, and about 20,000 sold worldwide, most of them in Japan. In 2001, 29,000 Priuses sold worldwide. By 2007, Toyota was selling 10 times that — 181,000 cars in the United States alone. And people kept putting their names on the waiting lists. Those sales numbers would have been much higher if production had kept pace with demand.

No other hybrid or fuel efficient car has been nearly as successful. The Toyota Yaris, which gets 80 percent of the Prius gas mileage and costs about half as much as a Prius, sold about half as many units in 2008. At 2008 fuel prices, you would have to drive your Prius at least 50,000 miles before the price difference was paid off in fuel savings.

The Honda Civic Hybrid was a dud in comparison to the Prius. Although its price and fuel efficiency were comparable, the car sold about 20 percent as many units in 2007. Compared with the 159,000 Priuses sold in the United States during 2008, Honda sold about 31,000 Civic Hybrids.

The Civic’s gass mileage, price, technology, reliability and overall quality were all comparable to the Prius. The biggest distinction between the two vehicles was their appearance. The Civic Hybrid looks like any other Civic, except that it has a little “Hybrid” emblem on its back end and a higher sticker price. The Prius looks like, well, a Prius. It’s perfectly recognizable from half a mile away.

So why would the Prius outsell the Civic Hybrid by a factor of five to one? Because the Prius is cool. Its wonky design instantaneously became a symbol for environmental awareness. Driving around in Prius projects the driver’s identity as a person who cares about the planet, and enjoys new technology. The same could be said of the buyers of any hybrid, but the Prius design projects the message more effectively. So the Prius is cool.

The Prius also emphasized the fun of new technology. It featured a large computer screen where the backing driver could see a detailed view from the car’s rear bumper. The rest of the time Prius owners could watch elaborate animations illustrating the hybrid technology and reporting fuel efficiency. I used to commute at the same time as a new Prius owner whose driving style mystified me. He never drove the speed limit. Generally, he was under the limit and he was erratic. One day, I would pass him driving 65 or 70 mph. The next day, he’d be toodling along at 55 mph. One day as I passed him I noticed he wasn’t looking at the road. He had his eyes trained on the center of his dashboard, at the information screen. Then I thought I understood why he drove at varying, unusual speeds. He was tracking the car’s fuel efficiency and adjusting his pace, probably to maximize its efficiency. Effectively, he was playing the Prius video game.

My friend Fred drives a Prius. Fred is a retired school principal in his seventies. He’s politically conservative. He loves BMW motorcycles and he and his wife, Gladys, spend several weeks every year traveling on his gorgeous touring bike. When they’re not traveling by motorcycle, they drive a Prius. That surprised me. Fred and Gladys didn’t seem like Prius types. When I was in the car with him, Fred demonstrated how the video camera in the rear bumper gave him a wide-angle view of the area behind the car. Then he pointed out the car’s almost perfect silence as it backed out of a parking space and maneuvered around the parking lot. We got out and he had me put my hand on a perfectly cold exhaust pipe. At slow speeds the electric motor powered the car and it emitted no pollution.

From Fred’s perspective, the Prius was not making a political statement. Fred loves good technology and his car was making a technological statement.

The history of the Prius illustrates an exciting phenomenon we might call the Prius Effect. When a new idea or a piece of technology ignites the human imagination, it can spread very rapidly. At the dawn of the new millennium, when 12-mpg SUVs were everywhere, a funny-looking little car with tiny wheels and a TV screen in its dashboard quite suddenly became one of the most popular automobiles in the United States. Movie stars drove them. Soccer moms wanted them. Competitors scrambled to develop their own wonky hybrids.

Pundits up and down the political spectrum doubt society’s capacity to change. The left wing expresses disappointment in our general attachment to selfish interests. The right wing resists change when it threatens its traditional way of seeing the world. The Prius Effect suggests that consumers, in general, are more flexible and inventive than most pundits imagine.